Commercial, Energy Efficiency, Commercial, Finance  -  September 18, 2017

TD Bank issues 1st green bond in US dollars

TD Bank Group announced Sept. 12 that it closed on the issuance of a US$1 billion green bond. its first in US dollars and one of the largest green bonds ever issued by a bank. Initially targeting an issue size of $500 million, the transaction was upsized to $1 billion and almost 70% of the issue went to green investors.

The issuance marked the Toronto-Dominion Bank's first in U.S. dollars and one of the largest green bonds ever issued by a bank, according to a news release. Initially targeting an issue size of $500 million, the transaction was upsized to $1 billion and almost 70% of the issue went to green investors.

Green bonds are classified as "green" for the requirement that capital raised through them be exclusively used for environment-friendly investments. The asset class has been viewed as a fast-growing source of low-cost debt for renewable energy and energy efficiency programs, with issuances from large commercial and industrial corporations such as Apple, Bank of America, Digital Realty and Unilever hitting the market in recent years. 

"As an underwriter, investor and now repeat issuer of green bonds, TD is a North American leader in delivering environmentally and socially responsible options to our clients," Amy West, head of socially responsible finance at TD Securities said in a statement. "We are thrilled with the response to our inaugural US dollar green bond issue, one of the largest from a financial institution."

TD,  which says it is the sixth largest bank in North America by branches, in 2014 became the first Canadian bank to issue a green bond. It has also participated in underwriting more than C$6.5 billion in green bonds since 2010. 

"We are seeing an exciting level of growth in the green bond market as investors recognize the opportunities associated with the transition to the low carbon economy," Karen Clarke-Whistler, chief environment officer for TD Bank Group said in a statement. "Participating in the green bond market is core to TD's low carbon business strategy and the success of our second green bond highlights the unique opportunity for financial institutions."

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